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Underwood and DiNapoli announce jail sentence for Queens pharmacy owner who stole $1.5 million from Medicaid

PRESS RELEASE


Joint Task Force

NEW YORK, N.Y. -- Attorney General Barbara D. Underwood and State Comptroller Thomas P. DiNapoli announced today the sentencing of Arkady Goldin, 40, of Brooklyn, owner of Value Pharmacy, Inc. ("Value"), a pharmacy formerly located in Queens before re-locating to its current location in Lynbrook, NY, for defrauding the New York State Medicaid program out of $1.5 million.
Today, Acting Supreme Court Justice Barry Kron of Queens County Supreme Court sentenced Arkady Goldin to six months in jail, five years' probation, and 200 hours of community service. Goldin and Value Pharmacy will be required to pay $1.5 million to New York State as restitution for the money stolen from Medicaid and an additional $1.5 million in financial penalties, for a total of $3 million.

"Mr. Goldin sought to enrich himself at the expense of vulnerable New Yorkers who rely on our Medicaid program. He now faces jail time and millions of dollars in restitution and penalties," said Attorney General Underwood. "This sentencing should send a clear message that we won't hesitate to hold fraudsters accountable."

"Mr. Goldin's jail sentence and order to repay millions to the state should serve as a warning," State Comptroller Thomas P. DiNapoli said. "Mr. Goldin defrauded a program meant to help vulnerable New Yorkers and is being held accountable. My thanks to Attorney General Underwood for our ongoing joint efforts to protect the public's money."

On June 8, 2018, Arkady Goldin pleaded guilty to Health Care Fraud in the Second Degree, a class C felony, and to violating the Social Services Law prohibition on the payment of kickbacks related to the State's Medicaid program, a class E felony. An investigation conducted by the Attorney General and Comptroller's Joint Task Force on Public Integrity revealed that Goldin had entered into an unlawful kickback arrangement with a former hospital employee to steer prescriptions to Value. As part of the scheme, Value submitted false claims to the Medicaid program for medications that it never dispensed.

The investigation uncovered that from January 2012 to November 2013, Goldin had a kickback arrangement with a former employee of Nassau University Medical Center (NUMC) who, earlier in the investigation, pleaded guilty to unlawfully accepting kickbacks related to Medicaid services. In exchange for steering expensive cancer prescriptions from NUMC to Value, Goldin paid the hospital employee a monthly cash referral fee and provided him with other items of value, including tickets to sporting events, an iPad, and free meals. State law strictly prohibits all medical providers, including pharmacies, from paying or offering to pay kickbacks to another person in return for the referral of medical services ultimately paid for by Medicaid.

Additionally, as part of the scheme, Value did not purchase sufficient amounts of medication from licensed New York State drug wholesalers that would have been necessary if Value legitimately dispensed prescriptions for which Value billed Medicaid. As a result of the unlawful scheme, Medicaid ultimately paid Value over $1.5 million for unlawful claims for medications.
Since 2011, the Attorney General and Comptroller have worked together to fight corruption through their Joint Task Force on Public Integrity. They have brought charges against dozens of individuals implicated in public corruption schemes around the state – resulting in the return of millions in restitution to taxpayers through these convictions.

Comptroller DiNapoli's investigation was led by the Office of the State Comptroller ("OSC") Division of Investigations, working with the OSC Division of State Government Accountability.

The MFCU investigation was conducted by MFCU Investigator Daniel McCarron with the support of Supervising Investigators Dominick DiGennaro and Ronald Lynch, under the supervision of MFCU Deputy Chief Investigator Kenneth Morgan. The audit investigation was led by Auditor-Investigator Edgar Romero and Senior Auditor-Investigator Olga Sunitsky, under the supervision of MFCU NYC Regional Chief Auditor Thomasina Smith. Investigative support was provided by Supervising Legal Assistant Wendy Dorival, as well as Confidential Legal Analysts Victoria Sepe, Daniel Herzog, and Patrice Noel. Additional components of the investigation were handled by Assistant Attorney General Lisa Wallace and Bureau Chief Brent Meltzer of the Attorney General's Real Estate Finance Bureau.
The criminal case was prosecuted by Special Assistant Attorneys General Michael Leigh and Megan Friedland under the supervision of MFCU NYC Deputy Regional Director Twan Bounds, Regional Director Christopher M. Shaw, and MFCU's Chief of Criminal Investigations–Downstate Thomas O'Hanlon. The civil case was handled by Special Assistant Attorneys General Elizabeth Kappakas and Diana Elkind, with the assistance of MFCU Civil Enforcement Chief Carolyn Ellis. MFCU is led by Director Amy Held and Assistant Deputy Attorney General Paul J. Mahoney. The Criminal Justice Division is led by Executive Deputy Attorney General Margaret Garnett.